Technavio research analyst predicts the global supply chain management (SCM) market to grow steadily at a CAGR of around 11% during the forecast period. The need to improve supply chain visibility and the desire for better transparency of orders, inventory, and shipment information, has driven the growth of the SCM market. SCM software provides better visibility to organizations with a cross-functional access and also offers exception-based process management platforms that enable staff to micro-manage steady-state processes.

Another key factor that is aiding the SCM market is the growing demand for SCM from SMEs. The primary reason for this demand is SCM’s ability to reduce the purchase cycle and obtain high productivity with low operating costs. Also, may SMEs are expanding their business operations, hence the need to implement SCM software to operate easily using automatic management systems is on the rise.

The SCP segment held the highest share in the global SCM software market with a market share of almost 35% in 2015. The growth of this segment is driven by the need for inventory planning. At present, enterprises use SCP software for demand planning, inventory planning, and asset planning. Moreover, the high demand emerging from developing countries in the APAC region is driving the growth of this segment.

Segmentation by deployment type and analysis of the SCM market
-Cloud
- On-premise

Even though the cloud SCM or on-demand software accounts for just over 25% of the overall market, organizations nowadays prefer on-demand over on-premise traditional SCM applications because the total deployment costs of on-demand are much less than on-premise. As a result, the demand for cloud SCM software is expected to increase tremendously during the next five years.

The presence of a large number of providers in the global SCM market increases the competition in the market. Therefore, providers are required to ensure the efficiency and management of various aspects of SCM to gain a competitive edge and retain their market positions. Besides, there has been a lot of acquisitions during 2015, and this trend is expected to increase over the forecast period.